Health Care Reform Glossary


Affordable Care Act – also referred to as health care reform
A law that was passed in March 2010 to improve access to affordable health insurance for many Americans.  

Annual Limit
A maximum amount of money your health plan will pay for a particular service, or on the number of visits that the health plan will cover for a particular service in a given year. If you reach it, you must pay all health care costs for that particular service for the rest of the year.

Cost-Sharing Discounts
Reduced dollar amounts for health plan features like annual deductibles and co-pays that are available to some who purchase their health insurance through the Health Insurance Marketplace. To be eligible for these reduced dollar amounts, the individual/family purchasing the coverage must qualify based on the amount of their household income. These discounts are generally not available to those who are eligible to enroll in a Lockheed Martin health plan.

Employer Shared Responsibility
A provision under the Affordable Care Act law that requires all companies with at least 50 full-time equivalent employees to offer affordable health coverage that provides a minimum level of coverage or be subject to a penalty.

Essential Health Benefits
A set of health care service categories that must be covered by certain health plans.  Services categories include:

  • Ambulatory patient services
  • Emergency services
  • Hospitalization
  • Maternity and newborn care
  • Mental health and substance use disorder services, including behavioral health treatment
  • Prescription drugs
  • Rehabilitative and habilitative services and devices
  • Laboratory services
  • Preventive and wellness services and chronic disease management
  • Pediatric services, including oral and vision care

All health insurance plans offered through the public Exchange must cover these services. State Medicaid plans must cover them too. Lockheed Martin health plans cover most of these benefits as well.

In addition, health plans cannot put a lifetime or annual dollar limit on benefits that are available for these services. Lockheed Martin health plans do not include lifetime or annual dollar limits on these benefits.

Federal Poverty Level (FPL)
The Federal Poverty Level is a measure of income level issued annually by the Department of Health and Human Services. Federal poverty levels are used to determine individual/family eligibility for certain programs and benefits that are available as a result of the Affordable Care Act. Federal Poverty Level Guidelines can be located on

Guaranteed Issue
This part of the Affordable Care Act requires health plans to enroll individuals regardless of health status, age, gender or other factors. Except in some states, guaranteed issue doesn't limit how much you can be charged if you enroll. Benefits-eligible employees have guaranteed issue for Lockheed Martin health plans.

Guaranteed Renewal
A part of the Affordable Care Act that requires health plans to renew your policy as long as you continue to pay premiums. Except in some states, guaranteed renewal doesn't limit how much you can be charged if you renew your coverage. Benefits-eligible employees have guaranteed renewal of their coverage under Lockheed Martin health plans.

Health Insurance Marketplace
A federal or state-based resource where individuals, families, and small businesses can: learn about their health coverage options; compare health insurance plans based on costs, benefits, and other important features; choose a plan; and enroll in coverage.

High-Cost Health Plan Excise Tax
A provision under the Affordable Care Act that will impose a tax on employers and insurance companies that provide high-cost health plans, beginning 2020.

Individual Health Insurance Policy
Coverage that is not tied to a person’s job, such as coverage that is purchased through the Health Insurance Marketplace. Policies are regulated under state law.

Individual Mandate
A provision under the Affordable Care Act that requires individuals and their family members to: have qualifying health coverage; qualify for a health coverage exemption; or make a shared responsibility tax payment. Enrollment in a Lockheed Martin health plan satisfies the individual mandate.

Job-Based Coverage
Health coverage that is offered to an employee (and often to his or her family) by his or her employer.

A state-run health insurance program for low-income adults, families and children, pregnant women, the elderly, people with disabilities, and in some states, others who qualify. The federal government provides a portion of the funding for Medicaid and sets guidelines for the program. States decide how they design their programs, so Medicaid (and what the program is called) varies state-by-state. The Affordable Care Act expands Medicaid eligibility in many states.

A federal system of health insurance for people over 65 years of age and for certain younger people with disabilities or end-stage renal disease (ESRD).

Minimum Essential Coverage (MEC)
The type of coverage an individual needs to have to satisfy the individual mandate requirement under the Affordable Care Act. Minimum Essential Coverage can be obtained from individual market policies, job-based coverage (including a Lockheed Martin health plan), Medicare, Medicaid, CHIP, TRICARE and certain other coverage.

Out-of-Pocket Costs
Medical care that aren't reimbursed by your health plan. They include deductibles, co-insurance and co-pays for covered services, plus all costs for services that aren't covered.

Out-of-Pocket Limit (OOP)
The OOP limit is the most you pay during the calendar year before your health plan begins to pay 100% of the allowed amount. This generally includes co-pays, annual deductibles and co-insurance payments.  This limit never includes your premium, balance-billed charges from health care providers or health care expenses that your health plan doesn’t cover.

The amount that must be paid for your health insurance. You usually pay it weekly.

Preventive Care
Routine services like screenings, check-ups and patient counselling that help prevent illnesses, disease or other health problems. Under the Affordable Care Act, you and your family members may be eligible for some these services with zero out-of-pocket costs.

Public Exchanges
(See Health Insurance Marketplace)

Qualified Health Plan
An insurance plan that is certified by the Health Insurance Marketplace, provides essential health benefits, follows established limits on cost-sharing (like deductibles, copayments, and out-of-pocket maximum amounts), and meets other requirements.

A form of financial assistance provided by the federal government. Under the Affordable Care Act, those who qualify can receive this assistance in the form of an advanced tax credit or cost-sharing discount when purchasing health insurance through the Health Insurance Marketplace.

Tax Penalty
The amount you may owe for every month that you do not have health insurance. Tax penalties are paid to the IRS when filing your annual federal tax return. For more information about tax penalties and other fees, please visit

Wellness Programs
A program intended to improve and promote health and fitness, usually offered through the work place, but sometimes offered directly to those who enroll through an insurance company. These programs offer premium discounts, cash rewards, gym memberships, and other incentives to participate.  Some examples of wellness programs include programs to help you stop smoking, diabetes management programs, weight loss programs, and preventive health screenings.